Unpaid Commissions in California: Earned Pay

When is a commission earned?

Read the agreement alongside the work, not just its label. Identify what triggers earning, how the amount is calculated and when it becomes ascertainable. An employer's description of an advance or draw may differ from an earned commission.

A contractual condition can raise its own legal questions. Do not assume every forfeiture clause is enforceable or that a sale alone proves an immediate right to payment. An attorney should compare the language, the services performed and the reason a payment was withheld.

What should the commission agreement show?

Labor Code section 2751 addresses covered employment commission agreements in California and their written computation and payment terms. Gather signed plans, amendments, acknowledgment emails and any compensation policies incorporated into them.

Build a transaction-by-transaction ledger: customer or deal reference, work date, earning event, agreed formula, payment and claimed shortfall. Keep customer details private; a public website form is not the place to upload the employer's confidential sales database.

What if you left before the commission was paid?

Separation does not answer whether a commission was already earned. Some earned amounts can be calculated at departure; others depend on information becoming available later. Final-pay timing and the validity of an active-employment condition require separate review.

Record the last day, the employer's promised payment date and the stated reason for withholding. A wage statement, release or severance agreement may address different obligations and should not be treated as interchangeable.

Do commissions affect overtime?

For a nonexempt employee, commissions can affect the regular rate used for overtime. Some commissioned employees are subject to specific exemptions. The compensation mix, occupation, wage order and actual work matter. The basic hourly estimator does not calculate commission adjustments.

Records to prepare

• 01Every version of the commission plan and signed amendments.
• 02Deal dates, earning conditions, payment history and chargeback notices.
• 03Messages about departure, customer payment or delayed commission runs.
• 04Time records and base pay if overtime may also be owed.

Questions about this topic

Sources and further reading

Use the linked authority for its stated subject. Firm biographies and service descriptions establish what the firm publishes; they are separate from statutes, agency guidance and State Bar licensing records.

• 01California Labor Code section 2751Primary source for the rules and limits discussed on this page.
• 02DIR: commission-agreement legislationAgency summary of the written commission-agreement requirement; read alongside current law.
• 03Labor Commissioner: paydays and final payPrimary source for the rules and limits discussed on this page.
• 04Labor Commissioner: overtime rules and exceptionsPrimary source for the rules and limits discussed on this page.

Related guidance and next steps